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State Board Report

December 2013

As I was preparing to write this month’s President’s Memo, I was reflecting on the great year we have had at NASBA. It was a record year financially, including the most direct support to State Boards, with many successes in our business operations. We took on challenges, sought after opportunities and continued to advance the relevancy of this great organization. However, with all that happened and was accomplished, it is evident that 2013 will be remembered by many as the year of the Financial Reporting Framework for Small- and Medium-Sized Entities (FRF-SME) disagreement. I am pleased that NASBA and AICPA were able to resolve the FRF-SME matter in an appropriate and accountable manner, and I am still somewhat amazed by the amount of attention given the issue in the world of bloggers and instant communications. It only shows that controversy makes more headlines than consultation.

In one article, a writer remarked about the audacity of the AICPA calling NASBA “a trade association,” and another wrote that “the two [AICPA and NASBA] have resorted to calling each other ‘trade associations’.” Now, I am not sure that NASBA is actually a trade association by definition, as government regulation of accountancy by State Boards and State Board members is clearly not a trade. I see NASBA more as a consolidation of regulators. But I was never offended by the description and was somewhat baffled by the inferences of slander or maliciousness by the authors. In fact, Merriam-Webster’s definition of “trade association” includes the words “for the protection and advancement of their common interest,” which nearly paraphrases our mission: “To enhance the effectiveness and advance the common interests of Boards of Accountancy.”

To those who have been associated with keeping the standards for becoming a CPA high, the slur comes when accounting is frequently referred to as an “industry,” not a “profession.” As the Uniform Accountancy Act underscores, the Boards are regulators of a profession, not an industry. Again referencing Merriam-Webster, a profession is “a calling requiring specialized knowledge and often long and intensive academic preparation.”

As I look back at this year, it becomes clear that “Mission Driven, Member Focused” was and is not just a slogan, theme or sound bite. It has become the core underpinning of NASBA and all that we do. In 2014, we will be addressing many important changes, developments and issues including: planning for a new practice analysis for the Uniform CPA Examination, consideration of new methods of recognition of foreign credentials, creating enhanced CPE auditing capability, exploring the possibility of mobility opportunities with Canada, discussing possible changes in accounting education measurement and many others. The core elements of “enhanced effectiveness” and “common interests” will be foundational in how NASBA approaches each of these issues.

This is the time of the year that our newly constituted committees, task forces and groups begin to come together to organize, develop and prioritize the elements of their various charges. The nearly 200 volunteers that make up these groups bring tremendous talent, passion and energy to the process. The exciting new Leadership Development and Diversity work groups certainly fall within our mission, but they also are indicative of the continued advancement of this organization.

As we enter into a new calendar year, across the country legislation will be introduced that could impact Boards of Accountancy either positively or negatively. While some legislation is anticipated, other bills may be a surprise. This legislative year NASBA, working closely with AICPA and State Societies, will provide unprecedented support for State Boards in monitoring and dealing with proposed legislation. The Legislative Support Committee will be able to provide expertise and resources to impacted State Boards. NASBA will also monitor\ and review: federal legislation, changes in standards or rules, and proposals from the Private Company Council, FASB, GASB and others. Our Regulatory Response Committee and other committees will be monitoring these developments and recommending appropriate responses to NASBA leaders.

I, for one, am looking forward to all that is possible in the new year. NASBA is well positioned to fulfill our mission. I think I can speak for all of our leadership, volunteers and staff when I say: We are proud to be your “trade association” for the regulation of the profession!

Happy holidays and a fantastic new year to all!

Semper ad meliora. (Always toward better things.)

— Ken L. Bishop
President and CEO

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